Earnings Less Influential Than Market Moves

This week’s Sentiment Survey special question, which was posted at the very beginning of the survey period, asked AAII members how second-quarter earnings have influenced their outlook for stock prices. Nearly 40% of respondents said that the quarterly results did not influence their outlook, with several citing their long-term investment strategy as the reason why. An additional 7% said that other factors are more influential, such as the concerns about global economic weakness. About 9% of respondents described themselves as being more cautious or pessimistic because of second-quarter earnings. Only 5% of respondents said that corporate earnings made them more optimistic. A few members directly mentioned the recent correction instead of answering this week’s special question, though the comments were varied.

Here is a sampling of the responses:

“One quarter’s earnings never influence my outlook for the long term.”

“The bigger concern is the global slowdown.”

“Earnings were okay, but the outlooks given by companies were not very comforting.”

“Earnings were good and I am still optimistic on the economy.”

“Not at all. The current sell-off is the primary influence on my outlook.”